In re Marriage of Mize

On
Appeal from the 62nd District Court Franklin County, Texas
Trial Court No. 11891

Before
Morriss, C.J., Moseley and Carter, JJ.

ORDER

Lester
D. Mize has filed an emergency motion requesting that our
Court review the supersedeas bond in connection with his
appeal of the trial court's final decree of divorce.
See Tex. R. App. P. 24.4. Lester claimed that the
trial court's order set an excessive bond amount of $1,
045, 430.38 necessary for Lester to avoid enforcement of the
judgment during the pendency of the appeal. Although Peggy J.
Mize filed a response to Lester's motion, we nevertheless
abated the appeal and remanded the case to the trial court to
conduct an evidentiary hearing on the issue of whether the
supersedeas bond entered in this case is excessive and should
be reduced, or whether the bond order issued by the trial
court is proper. See Tex. R. App. P. 24.2, 24.4(d);
see also Tex. Civ. Prac. & Rem. Code Ann. §
52.006 (West 2015).

The
trial court conducted an evidentiary hearing, issued findings
of fact and conclusions of law, and entered a new order which
requires Lester to post a cash deposit or a supersedeas bond
in the amount of $1, 266, 488.20, "which is the total
amount awarded to [Peggy] in the Decree, plus two years post
judgment interest and costs." We review the supersedeas
bond amount to determine if it is excessive.

A
judgment debtor may supersede the execution of a judgment by
filing sufficient security. See Tex. R. App. P.
24.2; Tex. Civ. Prac. & Rem. Code Ann. § 52.006. We
may review the trial court's determination of the
security required to supersede a judgment while it is on
appeal pursuant to Rule 24.4 of the Texas Rules of Appellate
Procedure. See Tex. R. App. P. 24.4. Among other
things, Rule 24.4 permits a review of the sufficiency or
excessiveness of the amount of security. On Lester's
motion, we undertake such a review here. See Tex. R.
App. P. 24.4(a).

The
evidence reflected that Peggy had been awarded various
vehicles, farm equipment, and tools in the final decree of
divorce. There was evidence to support the value of these
items, individually and collectively. That evidence was not
contested. The total value of personal property awarded to
Peggy was $51, 874.00. This amount was included in the total
amount of the cash deposit or bond required by the trial
court to supersede the judgment. Lester contends that the
value of the personalty awarded to Peggy was not properly
included in the bond amount because the personalty was in
Peggy's possession and was, therefore, not at risk. We
disagree with Lester's analysis. When a judgment awarding
the right to recover personalty is suspended, the bond cannot
be less than the value of the personal property interest as
of the date of the judgment. See Tex. R. App. P.
24.2(a)(2)(A); Devine v. Devine, No. 07-15-00126-CV,
2015 WL 5228254, at *3 (Tex. App.-Amarillo Sept. 2, 2015,
order). Lester cites no authority in support of his claim
that, because the personal property awarded to Peggy is in
her possession, its value should not be included in the
supersedeas bond amount, and we find no such authority. We
therefore conclude that the value of the personal property
awarded to Peggy was properly included in the amount of the
supersedeas bond set by the trial court.

The
evidence further established that Peggy was awarded funds in
certain bank accounts in the final decree of divorce,
totaling $390, 355.06. The amount of the funds in the
accounts was not disputed. Lester argued, however, that,
because funds in certain of the accounts awarded to Peggy had
been transferred into her name after the divorce, those funds
were not at risk and should not have been included in the
bond amount. To the contrary, both the rule and the statute
specifically provide that, when a judgment awarding the right
to recover money is suspended, the bond must equal the sum of
the compensatory damages awarded in the judgment, interest
for the estimated duration of the appeal, and costs awarded
in the judgment. See Tex. R. App. P. 24.2(a)(1);
Tex. Civ. Prac. & Rem. Code Ann. § 52.006(a);
see also White v. Pottorff, No. 05-14-00675-CV, 2015
WL 302810, at *4 (Tex. App.-Dallas Jan. 23, 2015, no pet.)
(mem. op.).

As
mentioned above as to the personal property, Lester provides
no authority for the proposition that, because Peggy is
currently in possession of funds awarded to her in the final
decree, those amounts should not be included in the
supersedeas bond amount, and we find no such authority. We
conclude that the value of the funds awarded to Peggy in the
final decree- $390, 355.06-was properly included in the
amount of the supersedeas bond.[1]

Finally,
Peggy was awarded a house and 14.5 acres of land in Mt.
Vernon. The house and land together were valued at $400,
000.00, and that value was undisputed. The trial court
included the entire value of the real property in the amount
of the supersedeas bond. Lester contends that this value
should not have been so included because the property was in
Peggy's possession and was therefore not at risk.
Although Lester's reasoning is incorrect, we agree with
him that the entire value of the real property should not
have been included in the amount of the supersedeas bond.
When a judgment awarding the right to recover real property
is suspended, the bond must be at least the value of the
property interest's rent or revenue. See Tex. R.
App. P. 24.2(a)(2)(A); Wickliffe v. Tooley, No.
05-15-00696-CV, 2015 WL 5013691, at *1 (Tex. App.-Dallas Aug.
25, 2015, no pet.) (mem. op.). Presumably that is intended to
cover the expected pendency of the appeal. See
Wickliffe, 2015 WL 5013691, at *2 (twelve months'
rent approved on appeal).

At
issue in Wickliffe was the amount of a supersedeas
bond to be set after entry of a default judgment setting
aside a deed allegedly transferring property from the
decedent to Wickliffe. The trial court set the supersedeas
bond at $75, 000.00, and Wickliffe claimed that amount was
excessive. Id. at *1. Applying an abuse of
discretion standard, the appellate court agreed. There was
testimony at the bond hearing that the rental value of the
property was $350.00 to $500.00 per month. Id. There
was additional testimony that the land was worth between $55,
000.00 and $60, 000.00 and the house was worth approximately
$5, 000.00 to $6, 000.00. Id. A realtor testified
that the total estimated value of the property was $150,
000.00. Id. Relying on the valuation of the
property, the trial court set the bond at $75, 000.00.
Id. In concluding that the bond amount was
excessive, the appellate court reasoned that, "[b]ased
on rule 24.2(a)(2)(A), the property's overall value is
not a relevant factor in setting the bond. Rather, the only
relevant factor is the value of the property interest's
rent or revenue." Id. Because
"[t]he only evidence at the hearing pertaining to this
factor was that the property would rent anywhere from $350 to
$500 a month . . . the trial court abused its discretion in
setting the bond at $75, 000."

Indeed,
when there is no evidence of a real property's rent or
revenue value, there can be no determination of "whether
any amounts over the real property's rent or revenue
value" are excessive. Fuentes v. Zaragoza, No.
01-16-00251-CV, 2016 WL 3023811, at *4 (Tex. App.- Houston
[1st Dist.] May 26, 2016, order). In Fuentes, the
evidence established that the fair market value of the real
property awarded to Zaragoza was $3.3 million. The trial
court ordered the amount of security for the judgment for the
recovery of an interest in real property at $3.3 million, in
the absence of any evidence of the property's rent or
revenue value. Id. Consequently, the court concluded
that it was error to require an additional $3.3 million to
secure the award of real property included in the final
judgment. Id.

Likewise,
in this case, there was no evidence of the rent or revenue
value of the real property awarded to Peggy in the final
decree. In the absence of such evidence, it was improper to
include an additional $400, 000.00 in the supersedeas bond
amount. Such inclusion renders the supersedeas bond amount
excessive.

We
therefore hold that the supersedeas bond in this case was
excessive only to the extent that it included the value of
the real property awarded to Peggy in the final decree. All
other amounts included by the trial court were proper and in
keeping with Rule 24.2 of the Texas Rules of Appellate
Procedure and with Section 52.006 of the Texas Civil Practice
and Remedies Code. And, although we find the bond to be
excessive, the evidence in the record ...

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